Farmers have been urged to adopt a more entrepreneurial approach in a new report due to be published at the Oxford Farming Conference (OFC), which starts today.
Commissioned and funded by OFC, the report concluded farmers were less entrepreneurial than other sectors but stressed those who were entrepreneurial run far more profitable businesses.
The 84-page report, ‘Entrepreneurship: A kiss of life for the UK farming sector’, stressed, however, entrepreneurialism could be learnt and called for it to be taught as part of all agricultural courses.
Full of case studies of entrepreneurial farmers, its authors said they wanted the report to act as a guide to make farmers more entrepreneurial in their mindset and approach.
Graham Redman, from the Andersons Centre, who compiled the report with Muhammad Azam Roomi of Cranfield University’s Centre for Entrepreneurship, said:
“Many farmers are successful business managers, but this doesn’t mean that they are entrepreneurial, nor does working long hours, nor taking risks.
“But executing innovative ideas such as developing a market opportunity for a beef enterprise to supply medical grade collagen for plastic surgery clinics is very entrepreneurial.”
The report noted how the structure of the agricultural industry often deters entrepreneurialism, with many businesses having almost no control of the price of what they are selling and, in some cases, not knowing the price until after it has been delivered.
Volatile sale prices can double or halve over a short time with barely any changes in consumption of the product as a result.
In addition the industry has received Government protection over the past 50 years, ‘offsetting the market violence’, protection that has been gradually declining.
Then there is the considerable political and environmental uncertainty and change that places additional pressures on the industry ‘in an almost uncharted way’.
All of which suggests the industry is ‘walking a tight-rope’.
“Within this context, it is understandable why many farmers prefer to keep non-essential risks such as debt and gearing, to a minimum, and that change or pioneering behaviour into new ventures, which inherently involves a new level of uncertainty, is sometimes not embraced with open arms,” the report said.
However, it challenges this strategy. The report, sponsored by Burges Salmon, describes entrepreneurship as ‘the pursuit of opportunity without regard to resources currently controlled’.
The research highlighted six points that need adopting by ‘budding Richard Bransons’.
Mr Redman said entrepreneurs ‘go out of their way to question the established order of things and look for ways to create competitive advantage’.
“It could mean concentrating a business to fewer activities; indeed business people with single objectives tend to be more successful than those with several.”
“Historically farmers were less profit orientated than most businesses, being more concerned with subsistence and survival; this helps to explain why farming demonstrates a lower level of entrepreneurialism than other sectors,” Mr Redman said.
But he added: “Farms are remarkably strong places from which to develop entrepreneurial businesses,” he added.
“They have valuable resources, most of which have been relatively inefficiently deployed, and often have a strong capital base.
"Of fundamental importance for successful entrepreneurialism on farm, is that the business must remain true to its agricultural roots, and respects the land and ‘home farm’ as their golden goose which lays the golden egg of entrepreneurialism.”
OFC chairman Al Brooks, said entrepreneurialism had been ‘explored widely outside agriculture, but rarely directly focused on our industry’.
“It’s clear that different character traits help entrepreneurialism, but only perseverance, persistence and proactivity are exclusively necessary to achieve something entrepreneurial," he said.
“Many fear failure, either from possible financial loss or the comments it might generate from others; this report clearly states that this can be overcome by a strong belief in yourself and your idea, even if you make mistakes along the way.”
The 2016 OFC begins today with various fringe ahead of the main conference programme, which is kicked off on Wednesday morning with appearances from Defra Secretary Liz Truss and her Labour Shadow Kerry McCarthy.